Trials@uspto.gov
`Tel: 571-272-7822
`
`Paper 9
`Entered: November 16, 2015
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`Petitioner,
`
`v.
`
`SMARTFLASH LLC,
`Patent Owner.
`
`Case CBM2015-00130
`Patent 8,118,221 B2
`
`
`
`
`
`
`
`
`
`Before JENNIFER S. BISK, RAMA G. ELLURU,
`JEREMY M. PLENZLER, and MATTHEW R. CLEMENTS
`Administrative Patent Judges.
`
`BISK, Administrative Patent Judge.
`
`DECISION
`Institution of Covered Business Method Patent Review
`37 C.F.R. § 42.208
`
`
`
`
`
`Tel: 571-272-7822
`
`Paper 9
`Entered: November 16, 2015
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`APPLE INC.,
`Petitioner,
`
`v.
`
`SMARTFLASH LLC,
`Patent Owner.
`
`Case CBM2015-00130
`Patent 8,118,221 B2
`
`
`
`
`
`
`
`
`
`Before JENNIFER S. BISK, RAMA G. ELLURU,
`JEREMY M. PLENZLER, and MATTHEW R. CLEMENTS
`Administrative Patent Judges.
`
`BISK, Administrative Patent Judge.
`
`DECISION
`Institution of Covered Business Method Patent Review
`37 C.F.R. § 42.208
`
`
`
`
`
`
`CBM2015-00130
`Patent 8,118,221 B2
`
`INTRODUCTION
`
`A. Background
`Petitioner, Apple Inc., filed a Petition to institute covered business
`method patent review of claims 3–10, 12–31, and 33 of U.S. Patent No.
`8,118,221 B2 (Ex. 1001, “the ’221 patent”) pursuant to § 18 of the Leahy-
`Smith America Invents Act (“AIA”). Paper 2 (“Pet.”).1 Patent Owner,
`Smartflash LLC, filed a Preliminary Response. Paper 7 (“Prelim. Resp.”).
`We have jurisdiction under 35 U.S.C. § 324(a), which provides that a
`covered business method patent review may not be instituted “unless . . . it is
`more likely than not that at least 1 of the claims challenged in the petition is
`unpatentable.”
`After considering the Petition and Preliminary Response, we
`determine that the ’221 patent is a covered business method patent and that
`Petitioner has demonstrated that it is more likely than not that at least one of
`the challenged claims is unpatentable. We further determine that Apple is
`estopped from challenging claims 12–14 in this proceeding. Accordingly,
`we institute a covered business method patent review of claims 3–10, 15–31,
`and 33 (the “challenged claims”), but not of claims 12–14 of the ’221 patent,
`as discussed below.
`
`B. Asserted Ground
`Petitioner contends that claims 3–10, 12–31, and 33 are unpatentable
`under 35 U.S.C. § 101 as being directed to patent-ineligible subject matter.
`Pet. 1. Petitioner also argues that that claims 6, 22, and 29 are also
`unpatentable under 35 U.S.C. § 112, ¶ 2 as indefinite. Id. at 76–79.
`
`
`1 Pub. L. No. 112–29, 125 Stat. 284, 296–07 (2011).
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`Petitioner provides a declaration from John P.J. Kelly, Ph.D. to support its
`challenges. Ex. 1021 (“the Kelly Declaration”).
`
`C. Related Matters
`The ’221 patent is the subject of several co-pending district court
`cases in the Eastern District of Texas. Pet. 32–33; Paper 6, 4–5. The ’221
`patent has also been challenged in several other petitions for covered
`business method patent review: CBM2014-00102; CBM2014-00103
`(consolidated with CBM2014-00102); CBM2014-00194; CBM2014-00199;
`CBM2015-00015; CBM2015-00117; and CBM2015-00126.
`Patents in the family of the ’221 patent are currently the subject of
`many other proceedings at the Office. See Paper 6, 2–4.
`D. The ’221 Patent
`The ’221 patent relates to “a portable data carrier for storing and
`paying for data and to computer systems for providing access to data to be
`stored” and the “corresponding methods and computer programs.” Ex. 1001
`1:21–25. Owners of proprietary data, especially audio recordings, have an
`urgent need to address the prevalence of “data pirates” who make
`proprietary data available over the Internet without authorization. Id. at
`1:29–56. The ’221 patent describes providing portable data storage together
`with a means for restricting access to that data upon validated payment. Id.
`at 1:59–2:11. This combination allows data owners to make their data
`available over the Internet with less fear of data piracy. Id. at 2:11–15.
`As described, the portable data storage device is connected to a
`terminal for Internet access. Id. at 1:59–67. The terminal reads payment
`information, validates that information, and downloads data into the portable
`storage device from the data supplier. Id. The data on the portable storage
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`device can be retrieved and output from a mobile device. Id. at 2:1–4. The
`’221 patent makes clear that the actual implementation of these components
`is not critical and may be implemented in many ways. See, e.g., id. at
`25:41–44 (“The skilled person will understand that many variants to the
`system are possible and the invention is not limited to the described
`embodiments . . . .”).
`
`E. Illustrative Claim
`Petitioner challenges claims 3–10, 12–31, and 33 of the ’221 patent.
`Claims 1, 12, 17, 24, 28, and 32 are independent. Claims 3–10 depend,
`directly or indirectly, from claim 1. Claims 13–16 depend, directly or
`indirectly, from claim 12. Claims 18–23 depend, directly or indirectly, from
`claim 17. Claims 25–27 depend, directly or indirectly, from claim 24.
`Claims 29–31 depend, directly or indirectly, from claim 28. Claim 33
`incorporates portions of claim 32. Claim 12 is illustrative of the claimed
`subject matter and is reproduced below:
`
`12. A method of providing data from a data supplier to a data
`carrier, the method comprising:
`reading payment data from the data carrier;
`forwarding the payment data to a payment validation
`system;
`retrieving data from the data supplier; and
`writing the retrieved data into the dat[a] carrier.
`Id. at 26:43–48.
`
`
`ANALYSIS
`
`A. Estoppel
`35 U.S.C. § 325(e)(1) mandates that:
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`Patent 8,118,221 B2
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`The petitioner in a post-grant review of a claim in a patent
`under this chapter that results in a final written decision under
`section 328(a) or the real party in interest or privy of the
`petitioner, may not request or maintain a proceeding before the
`Office with respect to that claim on any ground that the
`petitioner raised or reasonably could have raised during that
`post-grant review.
`
`We issued a final written decision in CBM2014-00102 (with which
`CBM2014-00103 was consolidated), determining that claims 12–14 of the
`’221 patent are unpatentable pursuant to 35 U.S.C. § 103. Apple Inc. v.
`Smartflash LLC, Case CBM2014-00102, slip op. at 43 (PTAB Sept. 25,
`2015) (Paper 52). Apple was the petitioner in CBM2014-00102, which
`resulted in a final written decision with respect to claims 12–14. Thus,
`pursuant to § 325(e)(1), Apple cannot “request or maintain” a proceeding
`before the Office with respect to these claims “on any ground” that Apple
`“raised or reasonably could have raised” during CBM2014-00102.
`Apple is estopped from maintaining this proceeding with respect to
`claims 12–14, which it challenges based on § 101. The Supreme Court
`issued its decision in Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347
`(2014) after Apple filed its petition in CBM2014-00102. Section 325(e)(1),
`however, does not make exceptions for intervening case law that clarifies
`jurisprudence. Moreover, although Alice was not decided, the Supreme
`Court had already decided Bilski and Mayo on which Alice relied, and a
`number of Federal Circuit cases had already issued finding computer-based
`method claims invalid under § 101. See, e.g., Accenture Global Servs.
`GmbH v. Guidewire Software, Inc., 728 F.3d 1336 (Fed. Cir. 2013);
`Bancorp Servs, LLC v. Sun Life Asur. Co., 687 F.3d 1266 (Fed. Cir. 2012);
`Dealertrack, Inc. v. Huber, 674 F.3d 1315 (Fed. Cir. 2012); Cybersource
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`Corp. v. Retail Decisions, Inc., 654 F.3d 1366 (Fed. Cir. 2011). Here, Apple
`“reasonably could have raised” a challenge to claims 12–14 of the ’221
`patent based on § 101 in its CBM2014-00102/CBM2014-00103 petitions.
`Thus, § 325(e)(1) is applicable to this claim.
`Because Apple is estopped from maintaining a proceeding with
`respect to claims 12–14 based on any ground it “reasonably could have
`raised” in its earlier petitions, we deny a covered business method patent
`review of claims 12–14 pursuant to § 101 in the present proceeding.
`
`B. Claim Construction
`In a covered business method patent review, claim terms are given
`their broadest reasonable interpretation in light of the specification in which
`they appear and the understanding of others skilled in the relevant art. See
`37 C.F.R. § 42.300(b). Applying that standard, we interpret the claim terms
`of the ’221 patent according to their ordinary and customary meaning in the
`context of the patent’s written description. See In re Translogic Tech., Inc.,
`504 F.3d 1249, 1257 (Fed. Cir. 2007). For purposes of this Decision, we
`determine that “payment data” is the only term requiring an express
`construction in order to conduct properly our analysis.
`Petitioner asserts that “[f]or review purposes, [payment data] should
`be construed to mean ‘data representing payment made for requested content
`data’ and is distinct from ‘access control data.’” Pet. 36.
`The plain and ordinary meaning of the two words that make up the
`term—“payment” and “data”—do not incorporate any notion of time and
`nothing about their combination changes that determination. As used in the
`’221 patent, “payment data” encompasses data relating to future, current,
`and past payments. For example, the ’221 patent states that “payment data
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`for making a payment to the system owner is received from the smart Flash
`card by the content access terminal and forwarded to an e-payment system.”
`1001, 20:59–62. This language indicates that payment data exists prior to
`the payment being made for the requested content. The ’221 patent also
`explains that “payment data received may either be data relating to an actual
`payment made to the data supplier, or it may be a record of a payment made
`to an e-payment system.” Id. at 6:60–63. This indicates that “payment data”
`includes data for payments that have already been made.
`Moreover, the plain and ordinary meaning of data does not implicate
`changes in character based on when it is used in a transaction. For example,
`a credit card number may qualify as “data relating to payment” before the
`number is processed, while the number is being processed, and after the
`number is processed. Thus, without an express description to the contrary,
`we presume that “payment data” retains the same meaning before, during,
`and after the payment operation. Neither party points to any such contrary
`description. In fact, the ’221 patent describes “payment data” in several
`instances as data relating to payment for the requested data item. Ex. 1001,
`6:51–53, 10:26–30, 10:39–41, 10:44–46.
`For purposes of this Decision, we determine that the broadest
`reasonable interpretation of “payment data” as used in the ’221 patent is
`“data relating to payment for the requested data item.”
`
`C. Covered Business Method Patent
`Section 18 of the AIA provides for the creation of a transitional
`program for reviewing covered business method patents. A “covered
`business method patent” is a patent that “claims a method or corresponding
`apparatus for performing data processing or other operations used in the
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`CBM2015-00130
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`practice, administration, or management of a financial product or service,
`except that the term does not include patents for technological inventions.”
`AIA § 18(d)(1); see 37 C.F.R. § 42.301(a). A patent need have only one
`claim directed to a covered business method to be eligible for review. See
`Transitional Program for Covered Business Method Patents—Definitions of
`Covered Business Method Patent and Technological Invention; Final Rule,
`77 Fed. Reg. 48,734, 48,736 (Aug. 14, 2012) (“CBM Rules”) (Comment 8).
`We previously have determined that the ’221 patent is a “covered
`business method patent.” See, e.g., CBM2014-00102, Paper 8, 8–12
`(determining that the ’221 patent is eligible for covered business method
`patent reviewed based on claim 12). In this case, Petitioner similarly asserts
`that claim 12 qualifies the ’221 patent for covered business method patent
`review. Pet. 22.
`
`1. Financial Product or Service
`Petitioner asserts that claim 12 “clearly relates to a financial activity
`and providing a financial service.” Pet. 25. Based on this record, we agree
`with Petitioner that the subject matter recited by claim 12 is directed to
`activities that are financial in nature, namely data access conditioned on
`payment validation. Claim 12 requires “reading payment data from the data
`carrier” and “forwarding the payment data to a payment validation system.”
`We are persuaded that the transfer of data relating to payment is a financial
`activity, and providing for such a transfer is a financial service. This is
`consistent with the specification of the ’221 patent, which confirms claim
`12’s connection to financial activities by stating that the invention “relates to
`a portable data carrier for storing and paying for data.” Ex. 1001, 1:21–23.
`The specification also states repeatedly that the disclosed invention involves
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`restricting access to data based on payment validation. See, e.g., id. at 1:59–
`68, 6:60–64, 20:50–54.
`Patent Owner disagrees that claim 12 satisfies the financial in nature
`requirement of AIA § 18(d)(1), arguing that that section should be
`interpreted narrowly to cover only technology used specifically in the
`financial or banking industry. Prelim. Resp. 46–50. Patent Owner cites to
`various portions of the legislative history as support for its proposed
`interpretation. Id.
`The Federal Circuit has expressly determined, however, that “the
`definition of ‘covered business method patent’ is not limited to products and
`services of only the financial industry, or to patents owned by or directly
`affecting the activities of financial institutions, such as banks and brokerage
`houses.” Versata Dev. Grp., Inc. v. SAP America, Inc., 793 F.3d 1306, 1325
`(Fed. Cir. 2015). Rather, “it covers a wide range of finance-related
`activities.” Id. Further, contrary to Patent Owner’s view of the legislative
`history, the legislative history overall indicates that the phrase “financial
`product or service” is not limited to the products or services of the “financial
`services industry” and is to be interpreted broadly. CBM Rules, 77 Fed.
`Reg. at 48,735–36. For example, the “legislative history explains that the
`definition of covered business method patent was drafted to encompass
`patents ‘claiming activities that are financial in nature, incidental to a
`financial activity or complementary to a financial activity.’” Id. (citing 157
`Cong. Rec. S5432 (daily ed. Sept. 8, 2011) (statement of Sen. Schumer)).
`In addition, Patent Owner asserts that claim 12 is not directed to an
`apparatus or method that is financial in nature because claim 12 “omits the
`specifics of how payment is made.” Prelim. Resp. 50. We are not
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`persuaded by this argument because § 18(d)(1) of the AIA does not include
`such a requirement, nor does Patent Owner point to any other authority that
`makes such a requirement. Id. We determine that because claim 12 recites
`“payment,” as Patent Owner acknowledges (id.), the financial in nature
`requirement of § 18(d)(1) is satisfied.
`For the reasons stated above, and based on the particular facts of this
`proceeding, we conclude that the ’221 patent includes at least one claim that
`meets the financial in nature requirement of § 18(d)(1) of the AIA.
`
`2. Exclusion for Technological Inventions
`Petitioner asserts that claim 12 does not fall within § 18(d)(1)’s
`exclusion for “technological inventions.” Pet. 26–32. In particular,
`Petitioner argues that claim 12 “does not claim ‘subject matter as a whole
`[that] recites a technological feature that is novel and unobvious over the
`prior art[] and solves a technical problem using a technical solution.’”
`Pet. 26 (quoting 37 C.F.R. § 42.301(b)).
`Claim 12 does recite a “payment validation system.” The
`specification, however, discloses that the required payment validation
`system may be one that is already in use or otherwise commercially
`available. For example, “[t]he payment validation system may be part of the
`data supplier’s computer systems or it may be a separate e-payment system.”
`Ex. 1001, 8:63–65; see id. at 13:35–47. Claim 12 also recites a “data
`carrier.” This component, however, is a generic hardware device known in
`the prior art. The specification discloses, for instance, that a data carrier
`may be a “standard smart card.” See id. at 11:28–29.
`In addition, the ’221 patent makes clear that the asserted novelty of
`the invention is not in any specific improvement of software or hardware,
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`but in the method of controlling access to data. For example, the ’221 patent
`states that “there is an urgent need to find a way to address the problem of
`data piracy” (id. at 1:52–55), while acknowledging that the “physical
`embodiment of the system is not critical and a skilled person will understand
`that the terminals, data processing systems and the like can all take a variety
`of forms” (id. at 12:29–32). Claim 12 is merely the recitation of known
`technologies to perform a method, which indicates that it is not a patent for a
`technological invention. See Office Patent Trial Practice Guide, 77 Fed.
`Reg. 48,756, 48,764 (Aug. 14, 2012).
`Patent Owner also argues that claim 12 falls within § 18(d)(1)’s
`exclusion for “technological inventions” because it is directed towards
`solving the technological problem of “the convenient, legitimate acquisition
`of data from a data supplier where payment data is read from a data carrier
`and data retrieved from the data supplier is written to the same data carrier”
`with the technological solution of “a data carrier from which payment is read
`and to which retrieved data is written.” Prelim. Resp. 51. We are not
`persuaded by this argument because, as Petitioner argues, the problem being
`solved by claim 12 is a business problem—data piracy. Pet. 30. For
`example, the Specification states that “[b]inding the data access and payment
`together allows the legitimate owners of the data to make the data available
`themselves over the internet without fear of loss of revenue, thus
`undermining the position of data pirates.” Ex. 1001, 2:11–15. Therefore,
`based on the particular facts of this proceeding, we conclude that claim 12
`does not recite a technological invention.
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`3. Conclusion
`In view of the foregoing, we conclude that the ’221 patent is a covered
`business method patent under AIA § 18(d)(1) and is eligible for review
`under the transitional covered business method patent program.
`
`D. Section 101 Patent-Eligible Subject Matter
`Petitioner challenges claims 3–10, 15–31, and 33 as directed to patent-
`ineligible subject matter under 35 U.S.C. § 101. Pet. 39–76. Petitioner
`asserts that the challenged claims are directed to an abstract idea without
`additional elements that transform it into a patent-eligible application of that
`idea (id. at 41–72), triggers preemption concerns (id. at 72–75), and fails the
`machine-or-transformation test (id. at 75–76).
`Patent Owner disagrees, arguing that the limitations of each of the
`challenged claims, taken as a combination, “recite specific ways of using
`distinct memories, data types, and use rules that amount[s] to significantly
`more than the underlying abstract idea” (Prelim. Resp. 17 (quoting Ex.
`2049, 19)), and that the claims do not result in inappropriate preemption (id.
`at 25–35). Patent Owner also asserts that (1) § 101 is not a ground that may
`be raised in a covered business method patent review (id. at 41–43); (2) the
`Office is estopped from revisiting the issue of § 101, which was inherently
`reviewed during examination (id. at 43–44); and (3) invalidating patent
`claims via covered business method patent review is unconstitutional (id. at
`44–46).
`
`1. Abstract Idea
`Under 35 U.S.C. § 101, we must first identify whether an invention
`fits within one of the four statutorily provided categories of patent-
`eligibility: “processes, machines, manufactures, and compositions of
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`matter.” Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 713–14 (Fed. Cir.
`2014). Here, each of the challenged claims recites either a “machine”—i.e.,
`a “data access terminal” (claims 3–10 and 33), a “data access device”
`(claims 17–23), a “data access system” (claims 28–31)—or a “process,”—
`i.e., a “method” (claims 15, 16, and 24–27)—under § 101. Section 101,
`however, “contains an important implicit exception to subject matter
`eligibility: Laws of nature, natural phenomena, and abstract ideas are not
`patentable.” Alice, 134 S.Ct. at 2354 (2014) (citing Assoc. for Molecular
`Pathology v. Myriad Genetics, Inc., 133 S.Ct. 2107, 2116 (2013) (internal
`quotation marks and brackets omitted)). In Alice, the Supreme Court
`reiterated the framework set forth previously in Mayo Collaborative Services
`v. Prometheus Laboratories, 132 S.Ct. 1289, 1293 (2012) “for
`distinguishing patents that claim laws of nature, natural phenomena, and
`abstract ideas from those that claim patent-eligible applications of these
`concepts.” Alice, 134 S.Ct. at 2355. The first step in the analysis is to
`“determine whether the claims at issue are directed to one of those patent-
`ineligible concepts.” Id.
`Petitioner argues that the challenged claims are directed to the abstract
`idea of “payment for and/or controlling access to data.” Pet. 41. Patent
`Owner does not dispute that the challenged claims are directed to an abstract
`idea. See Prelim. Resp. 12–25.
`We are persuaded that the challenged claims are more likely than not
`drawn to a patent-ineligible abstract idea. As discussed above, the ’221
`patent discusses addressing recording industry concerns of data pirates
`offering unauthorized access to widely available compressed audio
`recordings. Ex. 1001, 1:20–55. The ’221 patent proposes to solve this
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`problem by restricting access to data on a portable data carrier based upon
`payment validation. Id. at 1:59–2:4. The ’221 patent makes clear that the
`heart of the claimed subject matter is restricting access to stored data based
`on supplier-defined access rules and validation of payment. Id. at 1:59–
`2:15. We are, thus, persuaded, on this record, that the claimed “data access
`terminal,” is directed to an abstract idea. See Alice, 134 S.Ct. at 2356
`(holding that the concept of intermediated settlement at issue in Alice was an
`abstract idea); Accenture Global Servs., GmbH v. Guidewire Software, Inc.,
`728 F.3d 1336, 1344 (Fed. Cir. 2013) (holding the abstract idea at the heart
`of a system claim to be “generating tasks [based on] rules . . . to be
`completed upon the occurrence of an event”).
`2. Inventive Concept
`Turning to the second step in the § 101 analysis, we consider the
`elements of the claims “individually and ‘as an ordered combination’” to
`determine whether there are additional elements that “‘transform the nature
`of the claim’ into a patent-eligible application.” Mayo, 132 S.Ct. at 1297.
`On this record, we are not persuaded that the challenged claims of the ’221
`patent add an inventive concept sufficient to ensure that the patent in
`practice amounts to significantly more than a patent on the abstract idea
`itself. Alice, 134 S.Ct. at 2355; see also Accenture Global Servs., 728 F.3d
`at 1345 (holding claims directed to the abstract idea of “generating tasks
`[based on] rules . . . to be completed upon the occurrence of an event” to be
`unpatentable even when applied in a computer environment and within the
`insurance industry).
`Patent Owner argues that the challenged claims are patentable because
`they “recite specific ways of using distinct memories, data types, and use
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`rules that amount to significantly more than the underlying abstract idea.”
`Prelim. Resp. 17 (quoting Ex. 2049, 19). Patent Owner, however, does not
`elaborate as to how these claim limitations amount to significantly more than
`the underlying abstract idea.
`The Specification, as discussed above, treats as well-known all
`potentially technical aspects of the claim, including “program store” and
`“payment validation system” limitations recited in the challenged claims.
`For example, the Specification states that the payment validation system
`“may be part of the data supplier’s computer systems or it may be a separate
`system such as an e-payment system.” Ex. 1001, 8:23–25; see id. at 8:63–
`65. Further, with respect to the recited program store, the Specification
`discloses that “[t]he data storage means is based on a standard smart card.”
`Id. at 11:28–29; see also id. at 14:25–29 (“[l]ikewise data stores 136, 138
`and 140 may comprise a single physical data store or may be distributed
`over a plurality of physical devices and may even be at physically remote
`locations from processors 128-134 and coupled to these processors via
`internet 142.”), Fig. 6. The use of a program store and the linkage of
`existing hardware devices to existing payment validation processes appear to
`be “‘well-understood, routine, conventional activit[ies]’ previously known to
`the industry.” Alice, 134 S. Ct. at 2359; Mayo, 132 S. Ct. at 1294.
`The claims also generically list several data types including,
`“retrieved data,” “code,” “payment data,” “payment validation data,” and
`“use rule data.” The claims simply recite these data types with no
`description of the underlying programming. Patent Owner does not point to
`any inventive concept related to the way these data types are constructed or
`used. The recitation of these generic computer software data constructs,
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`being used simply to store data in the conventional manner, when considered
`in light of the accompanying description in the specification, is insufficient
`to confer specificity. See Content Extraction and Transmission LLC v.
`Wells Fargo Bank, 776 F.3d 1343, 1347 (Fed. Cir. 2014) (“The concept of
`data collection, recognition, and storage is undisputedly well-known.
`Indeed, humans have always performed these functions.”).
`Patent Owner also asserts that the challenged claims are like those in
`DDR Holdings, which the Federal Circuit held were directed to statutory
`subject matter because “‘the claimed solution is necessarily rooted in
`computer technology in order to overcome a problem specifically arising in
`the realm of computer networks.’” Prelim. Resp. 13 (quoting DDR
`Holdings, LLC v. Hotels.Com, LP., 773 F.3d 1245, 1257 (Fed. Cir. 2014)).
`According to Patent Owner, the challenged claims are “rooted in computer
`technology in order to overcome a problem specifically arising in the realm
`of computer networks—that of digital data piracy,” “‘a challenge particular
`to the Internet.’” Prelim. Resp. 14 (quoting DDR Holdings, 773 F.3d at
`1257).
`We are not persuaded that the challenged claims are like those at issue
`in DDR Holdings. In DDR Holdings, the Federal Circuit found that the
`challenged claims were directed to patentable subject matter because they
`“specif[ied] how interactions with the Internet are manipulated to yield a
`desired result—a result that overrides the routine and conventional aspects
`of the technology.” 773 F.3d at 1258. We are not persuaded that the
`challenged claims specify interactions that depart from the routine use of the
`recited devices. Instead, we determine, based on the current record, that the
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`claims merely apply conventional computer processes to restrict access to
`data based on payment.
`The differences between the challenged claims and those at issue in
`DDR Holdings are made clear by comparing the challenged claims of the
`’221 patent to claim 19 of the patent at issue in DDR Holdings. For
`example, claim 1 of the ’221 patent recites “code responsive to the payment
`validation data to . . . to write the retrieved data into the data carrier.”
`Prelim. Resp. 17. There is no language in this limitation, in any of the other
`challenged limitations, or in the specification of the ’221 patent, that
`demonstrates that the generic computer components—“code responsive to
`the payment validation data,” “to write the retrieved data,” and “data
`carrier”—function in an unconventional manner or employ sufficiently
`specific programming. Instead, these functions, software constructs, and
`other computer components, like all the other functions and computer
`components recited by the challenged claims, are “specified at a high level
`of generality,” which the Federal Circuit has found to be “insufficient to
`supply an inventive concept.” Ultramercial, 772 F.3d at 716.
`In DDR Holdings, exemplary claim 19 recites “using the data
`retrieved, automatically generate and transmit to the web browser a second
`web page that displays: (A) information associated with the commerce
`object associated with the link that has been activated, and (B) the plurality
`of visually perceptible elements visually corresponding to the source page.”
`Prelim. Resp. 17. It was this limitation from claim 19 in DDR Holdings,
`according to the Federal Circuit, that specifies “how interactions with the
`Internet are manipulated to yield a desired result—a result that overrides the
`routine and conventional sequence of events ordinarily triggered by the click
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`Patent 8,118,221 B2
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`of a hyperlink.” 773 F.3d at 1258. Importantly, the Federal Circuit
`identified this limitation as differentiating the DDR Holdings claims from
`those held to be unpatentable in Ultramercial, which “broadly and
`generically claim ‘use of the Internet’ to perform an abstract business
`practice (with insignificant added activity).” Id. We are persuaded, at this
`point in the proceeding, that the challenged claims are closer to the claims at
`issue in Ultramercial than to those at issue in DDR Holdings. The claims at
`issue in Ultramercial, like the challenged claims of the ’221 patent, were
`also directed to a method for distributing media products. Similar to
`restricting data based on payment, as in the challenged claims, the
`Ultramercial claims restricted access based on viewing an advertisement.
`Ultramercial, 772 F.3d at 712.
`Thus, on this record, we are persuaded that Petitioner has shown that
`it is more likely than not that the challenged claims—claims 3–10, 15–31,
`and 33—of the ’221 patent do not add an inventive concept sufficient to
`ensure that the patent in practice amounts to significantly more than a patent
`on the abstract idea itself. Alice, 134 S.Ct. at 2355; see also Accenture, 728
`F.3d at 1345 (holding claims directed to the abstract idea of “generating
`tasks [based on] rules . . . to be completed upon the occurrence of an event”
`to be unpatentable even when applied in a computer environment and within
`the insurance industry).
`3. Preemption
`Petitioner argues that “the challenged claims’ attempt to achieve
`broad functional coverage—with no relative contribution from the named
`inventors—firmly triggers preemption concerns.” Pet. 73. Patent Owner
`responds that the challenged claims do not result in inappropriate
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`preemption. Prelim. Resp. 25–35. According to Patent Owner, the
`challenged claims of the ’221 patent recite “specific ways of managing
`access to digital content data based on payment validation through storage
`and retrieval of use status data and use rules in distinct memory types and
`evaluating the use data according to use rules.” Id. at 27–28 (quoting Ex.
`2049, 20). Patent Owner also asserts that the existence of a large number of
`non-infringing alternatives shows that the claims of the ’221 patent do not
`raise preemption concerns. Id. at 25–32.
`Patent Owner’s preemption argument does not alter our § 101
`analysis. The Supreme Court has described the “pre-emption concern” as
`“undergird[ing] our § 101 jurisprudence.” Alice, 134 S.Ct. at 2358. The
`concern “is a relative one: how much future innovation is foreclosed relative
`to the contribution of the inventor.” Mayo, 132 S.Ct. at 1303. “While
`preemption may signal patent ineligible subject matter, the absence of
`complete preemption does not demonstrate patent eligibility.” Ariosa
`Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1379 (Fed. Cir. 2015).
`Importantly, the preemption concern i
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